Emami overcomes import pressures as parent company posts profit growth

INDIA — Emami Paper Mills reported a challenging third quarter of fiscal year 2025 (Q3 FY25), with profit after tax (PAT) plunging 77.6% year-on-year to INR 1.70 crore (US$191,757), despite facing strong headwinds from cheap paper imports.

The decline reflects the continued strain on India’s paper manufacturing sector amid rising competition from low-cost imports.

In contrast, the parent company, Emami Ltd, posted a robust 8% rise in Q3 profit, demonstrating the group’s diversified strength across sectors such as FMCG, healthcare, and paper manufacturing.

The weaker performance of Emami Paper Mills comes on the heels of a turbulent year marked by heavy import inflows from China, ASEAN nations, and Chile, which exerted downward pressure on local prices.

For the full fiscal year 2024–25, the company’s PAT dropped 69%, underscoring the impact of global trade dynamics on domestic manufacturers.

However, a recent regulatory intervention offers hope for recovery. The Directorate General of Trade Remedies (DGTR) has imposed anti-dumping duties on virgin multi-layer paperboards imported from Chile and China.

The measure aims to level the playing field for Indian producers, providing much-needed relief to Emami Paper Mills and its peers.

The company’s earlier reports show continued operational stress, with a 51% PAT decline in Q1 FY25 (to INR 6.31 crore), compared to the same quarter in the previous year.

Nonetheless, Emami Paper Mills has managed to maintain its IND A-/Stable credit rating and reduce finance costs by 9% over the last fiscal year, a testament to prudent financial management amid market volatility.

On the operational front, Emami has demonstrated resilience through strategic investments in capacity expansion and technological upgrades.

Its Balasore mill has been modernized with Valmet IntelliSizer and Bellmer TurboJetter headbox equipment to enhance production quality and flexibility across multiple paper grades.

The company has also achieved over 100% capacity utilization at its existing packaging board unit, expanding its production capability from 132,000 to 180,000 tonnes per annum.

Analysts note that the anti-dumping relief, coupled with Emami’s infrastructure upgrades, could stabilize performance in the coming quarters.

With rising demand for sustainable and high-quality packaging materials in India, the company’s strategic focus on innovation and efficiency positions it well to regain profitability despite ongoing import challenges.

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